Quarterly Report • Jul 27, 2011
Quarterly Report
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27 July 2011 No. 24/11
| Second quarter | First half-year | |||||||
|---|---|---|---|---|---|---|---|---|
| 2010 | 2011 Change | 2010 | 2011 Change | |||||
| Sales, SEK M | 9,356 | 10,502 | +12% | 17,701 | 19,201 | +8% | ||
| of which, | ||||||||
| Organic growth | +5% | +5% | ||||||
| Acquisitions | +20% | +14% | ||||||
| Currency effects | -956 | -13% | -1,623 | -11% | ||||
| Operating income (EBIT), | ||||||||
| SEK M | 1,515 | 1,615 | +7% | 2,810 | 2,992 | +6% | ||
| Operating margin (EBIT), % | 16.2 | 15.4 | 15.9 | 15.6 | ||||
| Income before tax, SEK M | 1,363 | 1,460 | +7% | 2,521 | 2,675 | +6% | ||
| Net income, SEK M | 1,031 | 1,156 | +12% | 1,910 | 2,099 | +10% | ||
| Operating cash flow, SEK M | 1,440 | 1,311 | -9% | 2,310 | 1,758 | -24% | ||
| Earnings per share (EPS), | ||||||||
| SEK | 2.74 | 3.07 | +12% | 5.10 | 5.60 | +10% |
"In the second quarter of the year sales grew by an exciting 25% in local currencies, made up of 5% organic growth and 20% acquired growth," says Johan Molin, President and CEO. Asia and South America showed strong growth, while development in the mature markets
was slow but stable. It was pleasing that our electromechanical products did extremely well and continued to grow in all divisions and on all markets, with HID in particular reporting great successes and achieving 19% organic growth during the quarter.
"Operating income improved by 7% in spite of strong negative currency effects. The operating margin was affected positively by the volume growth and the efficiency and restructuring programs at the same time as it was diluted by acquisitions and currency .
"It is very pleasing that the Cardo deal is now concluding with the signing with ABB Ltd for the sale of Lorentzen & Wettre. This means that the parts of Cardo that do not fit ASSA ABLOY long term will get industrial owners that gives them better opportunities for continued development and growth. The integration of Crawford is progressing rapidly and is looking extremely promising.
"During the quarter Portafeu, France's leading manufacturer of fire doors, was acquired and its integra tion into EMEA division is in good progress. Portafeu broadens our offer in one of our most important European markets. I want to take this opportunity to welcome Portafeu's highly skilled staff into the Group.
"The business cycle on the mature markets is expected to be slow but stable due to cuts in public spending at the same time as the development on the emerging markets is expected to continue to be positive."
The Group's sales totaled SEK 10,502 M (9,356), an increase of 12% compared with 2010. Organic growth for comparable units was 5% (2). Acquired units contributed 20% (8). Currency effects had a negative impact of SEK 956 M on sales, that is –13% (–5).
Operating income before depreciation, EBITDA, excluding restructuring costs, amounted to SEK 1,863 M (1,780). The corresponding EBITDA margin was 17.7% (19.0). The Group's operating income, EBIT, amounted to SEK 1,615 M (1,515), an increase of 7%. The operating margin was 15.4% (16.2).
Net financial items amounted to SEK -156 M ( -152). The Group's income before tax amounted to SEK 1,460 M (1,363), an improvement of 7% compared with the previous year. Currency effects had a negative impact of SEK 153 M on the Group's income before tax. The profit margin was 13.9% (14.6). The estimated effective tax rate amounted to 22%, giving a tax charge of SEK 321 M (333). Earnings per share amounted to SEK 3.07 (2.74), an increase of 12%.
Sales for the first half of 2011 totaled SEK 19,201 M (17,701), representing an increase of 8%. Organic growth was 5% (-1). Acquired units contributed 14% (6). Currency effects affected sales negatively by SEK 1,623 M, that is -11% (-5), compared with the first half of 2010.
Operating income before depreciation, EBITDA, excluding restructuring costs, amounted to SEK 3,4 93 M (3,316) for the half-year. The corresponding margin was 18.2% (18.7). The Group's operating income, EBIT, excluding restructuring costs, amounted to SEK 2,992 M (2,810), an increase of 6%. The corresponding operating margin (EBIT) was 15.6% (15.9).
Earnings per share for the first half-year rose to SEK 5.60 (5.10) an increase of 10%. Operating cash flow for the half-year amounted to SEK 1,758 M (2,310).
Payments related to all restructuring programs amounted to SEK 67 M in the quarter.
The restructuring programs continued according to plan and have led to a reduction in personnel of 89 people during the quarter and 5,572 people since the projects began. A further 816 people will leave by the end of 2012.
At the end of the quarter, a provision of SEK 809 M was set aside in the balance sheet for carrying out the remaining parts of the programs.
Sales for the quarter in EMEA division totaled SEK 3,253 M (3,311), with organic growth of -3% (3). The market trend remained weak during the second quarter and only Germany, Scandinavia, Eastern Europe and Israel showed growth. Acquired growth amounted to 8%. Operating income to taled SEK 510 M (525), which represents an operating margin (EBIT) of 15.7% (15.9). Return on capital employed amounted to 20.6% (19.9). Operating cash flow before interest paid totaled SEK 429 M (613).
Sales for the quarter in Americas division totaled SEK 2,177 M (2,503), with organic growth of 2% (–4). The sales trend during the quarterwas positive and all business units except Mexico showed growth, with especially good performance from Electromechanics, Residentialand South America. Acquired growth amounted to 1%. Operating income
totaled SEK 456 M (493) and the operating margin was 20.9% (19.7). Return on capital employed amounted to 23.6% (21.6). Operating cash flow before interest paid totaled SEK 482 M (586).
Sales for the quarter in Asia Pacific division totaled SEK 1,630 M (1,566), with organic growth of 12% (18). G rowth was strong throughout Asia, and especially for security doors in China. Australia and New Zealand recorded a negative sales trend affected by the natural disasters in the region and a reduction in stimulation measures in Australia. Acquired growth amounted to 2%. Operating income totaled SEK 232 M (222), representing an operating margin (EBIT) of 14.3% (14.2). The quarter's return on capital employed amounted to 22.4% (20.3). Operating cash flow before interest paid totaled SEK 199 M (57).
Sales for the quarter in Global Technologies division totaled SEK 1,416 M (1,240), with organic growth amounting to 17% (5). HID showed strong growth again in the second quarter, but with an increasing proportion of project orders with lower margins. Hospitality recorded strong growth driven by the recovery on the renovation market and rising sales of RFID locks and energy-efficiency products. Acquired growth amounted to 14%. The division's operating income amounted to SEK 224 M (208), giving an operating margin (EBIT) of 15.9% (16.8). The operating margin was diluted by 1.1% from the acquisitions of LaserCard and ActivIdentity. Return on capital employed amounted to 15.0% (14.5). Operating cash flow before interest paid totaled SEK 270 M (204).
Sales for the quarter in Entrance Systems division totaled SEK 2,235 M (1,012), with organic growth amounting to 5% (–2). Growth was good for all units including the newly acquired Crawford (formerly Cardo) and FlexiForce. Profitability also showed a positive trend for all units and the integration of Crawford and FlexiForce proceeded at a satisfactory pace. Acquired growth amounted to 135%. Operating income totaled SEK 281 M (145), giving an operating margin of 12.6% (14.3). The operating margin was diluted by 2.4% mainly from the acquisition of Crawford (Cardo). Return on capital employed amounted to 10.6% (13.6). Operating cash flow before interest paid totaled SEK 1 66 M (106).
During the quarter FlexiForce in the Netherlands, Swesafe in Sweden, Portafeu in France and one minor acquisition were consolidated. The combined acquisition price for the eight companies acquired during the first half-year, excluding disposal groups, amounted to SEK 6,429 M, and preliminary acquisition analyses indicate that goodwill and other intangible assets with indefinite useful life amount to SEK 5,778 M. The acquisition price is adjusted for acquired net debt and estimated earn-outs. Estimated earn -outs amount to SEK 290 M.
The acquisition analysis for Cardo Entrance Solutions is presented on Page 18. The parts of Cardo that are to be divested – that is, Cardo Flow Solutions and Lorentzen & Wettre – have been classified as 'disposal groups held for sale' in accordance with IFRS 5, 'Noncurrent Assets Held for Sale and Discontinued Operations'. The disposal groups have been valued at fair value at the time of acquisition with a deduction for costs to sell.
On 4 July it was announced that ASSA ABLOY had signed a contract with the Swedish/ Swiss co mpany ABB Ltd for the sale of Lorentzen & Wettre, part of the former Cardo Group. The sale price is SEK 750 M on a liability-free basis. The sale is expected to be completed during the second half of 2011.
The Security Doors business unit of ASSA ABLOY Americas has received both GREENGUARD Indoor Air Quality Certification and GREENGUARD Children & Schools Certification for its four brands Ceco, Curries, Graham and Maiman.
The GREENGUARD Environmental Institute certifies products and materials that give off the lowest possible levels of particles and chemical vapors during their lifetimes, with the aim of recommending healthier products and materials for indoor environments.
Other operating income for the Parent companyASSA ABLOY AB totaled SEK 877 M (911) for the half-year. Income before tax amounted to SEK 592 M (1,188), a reduction due primarily to reduced dividends from subsidiaries. Investments in tangible and intangible assets totaled SEK 2 M (1). Liquidity is good and the equity ratio was 36.2 % (50.4). The equity ratio has fallen because of borrowing for the acquisition of Cardo.
ASSA ABLOY applies International Financial Reporting Standards (IFRS) as endorsed by the European Union. Significant accounting and valuation principles are detailed on pages 86-91 of the 2010 Annual Report. From 2011 ASSA ABLOY is implementing the International Financial Reporting Standard IFRS 5, 'Non-current Assets Held for Sale and Discontinued Ope rations'. Non-current assets are classified as assets held for sale when their carrying amount will be largely recovered in a sales transaction and a sale is viewed as being highly probable. They are reported at the lower of carrying amount and fair value less costs to sell if their carrying amount can be largely recovered in a sales transaction and not through continuing use and it is highly probable that a sale will occur.
This Interim Report was prepared in accordance with IAS 34 'Interim Financial Reporting' and the Annual Accounts Act. The Interim Report for the Parent company was prepared in accordance with the Annual Accounts Act and RFR 2 'Reporting by a Legal Entity'.
No transactions that significantly affected the company's position and income have taken place between ASSA ABLOY and related parties.
As an international Group with a wide geographic spread, ASSA ABLOY is exposed to a number of business and financial risks. The business risks can be divided into strategic, operational and legal risks. The financial risks are related to such factors as exchange rates, interest rates, liquidity, the giving of credit, raw materials and financial instruments. Risk management in ASSA ABLOY aims to identify, control and reduce risks. This work begins with an assessment of the probability of risks occurring and their potential effect on the Group. For a more detailed description of risks and risk management, see the 2010 Annual Report. No significant risks other than the risks described there are judged to have occurred.
Long term, ASSA ABLOY expects an increase in security-driven demand. Focus on end-user value and innovation as well as leverage on ASSA ABLOY's strong position will accelerate growth and increase profitability.
Organic sales growth is expected to continue at a good rate. The operating margin (EBIT) and operating cash flow are expected to develop well.
* Outlook published on 28 April 2011:
Long-term outlook
Long term, ASSA ABLOY expects an increase in security-driven demand. Focus on end-user value and innovation as well as leverage on ASSA ABLOY's strong position will accelerate growth and increase profitability.
Organic sales growth is expected to continue at a good rate. The operating margin (EBIT) and operating cash flow are expected to develop well.
The Board of Directors and the President and CEO declare that this half-year report gives an accurate picture of the Parent company's and the Group's operations, position and income and describes significant risks and uncertainty factors faced by the Parent company and the companies making up the Group.
Stockholm, 27 July 2011
Gustaf Douglas Carl Douglas Birgitta Klasén
Chairman Board member Board member
Board member President and CEO Board member
Eva Lindqvist Johan Molin Sven-Christer Nilsson
Lars Renström Ulrik Svensson Seppo Liimatainen Board member Board member Employee representative
Mats Persson Employee representative
We have reviewed this Report for the period 1 January to 30 June 2011 for ASSA ABLOY AB (publ). The Board of Directors and the CEO are responsible for the preparation and presentation of this Interim Report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this Interim Report based on our review.
We conducted our review in accordance with the Swedish Standard on Review Engagements SÖG 2410, 'Review of Interim Report Performed by the Independent Auditor of the Entity '. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not expre ss an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the Interim Report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the Parent company.
Stockholm, 27 July 2011
PricewaterhouseCoopers AB
Peter Nyllinge
Authorized Public Accountant Auditor in charge
The Quarterly Report for the third quarter will be published on 28 October 2011 .
Johan Molin, President and CEO, Tel: +46 8 506 485 42 Tomas Eliasson, Chief Financial Officer, Tel: +46 8 506 485 72
ASSA ABLOY is holding an analysts' meeting a t 10.00 today at Operaterrassen in Stockholm. The analysts' meeting can also be followed on the Internet at www.assaabloy.com. It is possible to submit questions by telephone on: +46 8 5052 0270, +44 208 817 9301 o r + 1 718 354 1226
This information is that which ASSA ABLOY is required to disclose under the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act.
The information is released for publication at 08.00 on 27 July.
| INCOME STATEMENT | Jan-Dec | Jan -Jun Jan-Jun | Apr-Jun | Apr-Jun | |
|---|---|---|---|---|---|
| 2010 | 2010 | 2011 | 2010 | 2011 | |
| SEK M | SEK M | SEK M | SEK M | SEK M | |
| Sales | 36,823 | 17,701 | 19,201 | 9,356 | 10,502 |
| Cost of goods sold Gross Income |
-21,987 14,836 |
-10,580 7,121 |
-11,591 7,610 |
-5,596 3,761 |
-6,452 4,050 |
| Selling and administrative expenses | -8,793 | -4,312 | -4,636 | -2,246 | -2,448 |
| Share in earnings of associated companies | 3 | 0 | 18 | 0 | 12 |
| Operating income | 6,046 | 2,810 | 2,992 | 1,515 | 1,615 |
| Financial items | -680 | -289 | -317 | -152 | -155 |
| Income before tax | 5,366 | 2,521 | 2,675 | 1,363 | 1,460 |
| Tax | -1,286 | -611 | -589 | -333 | -321 |
| Net income of disposal group classified as held for sale | - | - | 13 | - | 17 |
| Net income | 4,080 | 1,910 | 2,099 | 1,031 | 1,156 |
| Allocation of net income: | |||||
| Shareholders in ASSA ABLOY AB | 4,050 | 1,895 | 2,084 | 1,019 | 1,143 |
| Non-controlling interest | 30 | 15 | 14 | 11 | 13 |
| EARNINGS PER SHARE | Jan-Dec | Jan -Jun Jan-Jun | Apr-Jun | Apr-Jun | |
| 2010 | 2010 | 2011 | 2010 | 2011 | |
| Total operations | SEK | SEK | SEK | SEK | SEK |
| 1) Earnings per share after tax and before dilution |
11.07 | 5.18 | 5.65 | 2.79 | 3.08 |
| Earnings per share after tax and dilution 2) | 10.89 | 5.10 | 5.60 | 2.74 | 3.07 |
| Continuing operations | |||||
| Earnings per share after tax and before dilution 1) |
11.07 | 5.18 | 5.62 | 2.79 | 3.04 |
| Earnings per share after tax and dilution 2) | 10.89 | 5.10 | 5.57 | 2.74 | 3.02 |
| Discontinued operations | |||||
| 1) Earnings per share after tax and before dilution |
- | - | 0.03 | - | 0.04 |
| Earnings per share after tax and dilution 2) | - | - | 0.03 | - | 0.05 |
| COMPREHENSIVE INCOME | Jan-Dec | Jan -Jun Jan-Jun | Apr-Jun | Apr-Jun | |
| 2010 SEK M |
2010 SEK M |
2011 SEK M |
2010 SEK M |
2011 SEK M |
|
| Profit for the period | 4,080 | 1,910 | 2,099 | 1,031 | 1,156 |
| Other comprehensive income | |||||
| Exchange differences on translating foreign operations | -1,249 | 579 | -662 | 739 | 383 |
| Total comprehensive income for the period | 2,831 | 2,489 | 1,437 | 1,770 | 1,539 |
| Total comprehensive income attributable to: | |||||
| -Parent company shareholders | 2,805 | 2,461 | 1,432 | 1,747 | 1,525 |
| -Non-controlling interest | 26 | 28 | 5 | 22 | 14 |
| CASH FLOW STATEMENT | Jan-Dec | Jan -Jun Jan-Jun | Apr-Jun | Apr-Jun | |
| 2010 | 2010 | 2011 | 2010 | 2011 | |
| SEK M | SEK M | SEK M | SEK M | SEK M | |
| Cash flow from operating activities | 5,729 | 1,834 | 1,441 | 1,287 | 1,120 |
| Cash flow from investing activities | -4,027 | -1,461 | -12,987 | -643 | -1,219 |
| Cash flow from financing activities | -2,597 | -1,358 | 11,702 | -1,097 | -25 |
| Cash flow | -895 | -985 | 156 | -453 | -124 |
| Cash and cash equivalents at beginning of period | 2,235 | 2,235 | 1,302 | 1,710 | 1,517 |
| Cash flow | -895 | -985 | 156 | -453 | -124 |
| Effect of exchange rate differences | -38 | 63 | -54 | 56 | 11 |
| Cash and cash equivalents at end of period | 1,302 | 1,313 | 1,404 | 1,313 | 1,404 |
| BALANCE SHEET | 31 Dec | 30 Jun | 30 Jun |
|---|---|---|---|
| 2010 SEK M |
2010 SEK M |
2011 SEK M |
|
| Intangible assets | 25,193 | 25,703 | 30,040 |
| Tangible fixed assets | 5,422 | 6,116 | 5,753 |
| Financial fixed assets | 1,595 | 970 | 1,986 |
| Total non-current assets | 32,210 | 32,789 | 37,779 |
| Inventories | 4,825 | 5,189 | 5,938 |
| Trade receivable | 5,596 | 6,100 | 6,772 |
| Other non-interest-bearing current assets | 1,308 | 1,350 | 1,501 |
| Interest-bearing current assets | 1,450 | 1,476 | 1,614 |
| Assets of disposal group classified as held for sale | - | - | 7,646 |
| Total current assets | 13,179 | 14,115 | 23,471 |
| Total assets | 45,389 | 46,905 | 61,250 |
| Equity before non-controlling interest | 20,652 | 20,269 | 20,907 |
| Non-controlling interest | 169 | 174 | 301 |
| Total equity | 20,821 | 20,443 | 21,208 |
| Interest-bearing non-current liabilities | 9,212 | 11,415 | 7,796 |
| Non-interest-bearing non-current liabilities | 4,236 | 3,928 | 4,791 |
| Total non-current liabilities | 13,448 | 15,343 | 12,587 |
| Interest-bearing current liabilities | 2,864 | 2,729 | 17,279 |
| Non-interest-bearing current liabilities | 8,256 | 8,390 | 8,908 |
| Liabilities of disposal group classified as held for sale | - | - | 1,268 |
| Total current liabilities | 11,120 | 11,119 | 27,455 |
| Total equity and liabilities | 45,389 | 45,905 | 61,250 |
| CHANGE IN EQUITY | Jan-Dec | Jan-Jun | Jan-Jun |
| 2010 | 2010 | 2011 | |
| SEK M | SEK M | SEK M | |
| Opening balance | 19,334 | 19,334 | 20,821 |
| Total comprehensive income for the year | 2,831 | 2,489 | 1,437 |
| Dividend | -1,317 | -1,317 | -1,472 |
| Stock purchase plans | 6 | 1 | 5 |
| Share issue 11) | 34 | - | 308 |
| Purchase of treasury shares | -48 | -48 | -17 |
| Non-controlling interest, net | -19 | -16 | 126 |
| Closing balance | 20,821 | 20,443 | 21,208 |
| KEY DATA | Jan-Dec | Jan-Jun | Jan-Jun |
| 2010 | 2010 | 2011 | |
| Return on capital employed excluding items affecting comparability, % | 18.5 | 17.0 | 16.5 |
| Return on shareholders' equity, % | 19.1 | 18.0 | 19.1 |
| Equity ratio, % | 45.9 | 43.6 | 34.6 |
| Interest coverage ratio, times | 10.1 | 9.7 | 10.7 |
| Interest on convertible debentures net after tax, SEK M | 9.9 | 4.7 | 4.8 |
| Number of shares, thousands | 366,177 | 365,918 | 368,250 |
| Weighted average number of shares, thousands | 365,744 | 365,850 | 368,878 |
| Number of shares after dilution, thousands | 372,736 | 372,718 | 372,918 |
| Weighted average number of shares after dilution, thousands | 372,810 | 372,882 | 373,000 |
| Average number of employees | 37,279 | 36,962 | 39,677 |
| INCOME STATEMENT | Jan-Dec 2010 |
Jan-Jun 2010 |
Jan-Jun 2011 |
|---|---|---|---|
| SEK M | SEK M | SEK M | |
| Operating income | 778 | 487 | 486 |
| Income before tax | 1,679 | 1,188 | 592 |
| Net income | 1,492 | 1,189 | 594 |
| BALANCE SHEET | 31 Dec | 30 Jun | 30 Jun |
| 2010 | 2010 | 2011 | |
| SEK M | SEK M | SEK M | |
| Non-current assets | 20,614 | 21,754 | 31,844 |
| Current assets | 3,560 | 3,978 | 2,551 |
| Total assets | 24,174 | 25,732 | 34,395 |
| Equity | 12,781 | 12,974 | 12,436 |
| Provisions | 0 | 2,033 | 0 |
| Non-current liabilities | 3,601 | 5,434 | 2,944 |
| Current liabilities | 7,792 | 5,291 | 19,015 |
| Total equity and liabilities | 24,174 | 25,732 | 34,395 |
All amounts in SEK M if not otherwise noted.
| Q1 2010 |
Q2 2010 |
Q3 2010 |
2010 | Q4 Jan-Jun 2010 |
Full Year 2010 |
Q1 2011 |
Q2 2011 |
Jan-Jun 2011 |
12 month rolling |
|
|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 8,345 | 9,356 | 9,474 | 9,648 | 17,701 | 36,823 | 8,699 | 10,502 | 19,201 | 38,323 |
| Organic growth 4) | -3% | 2% | 6% | 6% | -1% | 3% | 6% | 5% | 5% | |
| Gross income | 3,361 | 3,761 | 3,846 | 3,869 | 7,121 | 14,836 | 3,560 | 4,050 | 7,610 | 15,325 |
| Gross income / Sales | 40.3% | 40.2% | 40.6% | 40.1% | 40.2% | 40.3% | 40.9% | 38.6% | 39.6% | 40.0% |
| Operating income before | ||||||||||
| depreciation (EBITDA) | 1,536 | 1,780 | 1,875 | 1,851 | 3,316 | 7,041 | 1,630 | 1,863 | 3,493 | 7,219 |
| Operating margin (EBITDA) | 18.4% | 19.0% | 19.8% | 19.2% | 18.7% | 19.1% | 18.7% | 17.7% | 18.2% | 18.8% |
| Depreciation | -241 | -265 | -245 | -244 | -506 | -995 | -253 | -248 | -501 | -990 |
| Operating income (EBIT) | 1,295 | 1,515 | 1,630 | 1,606 | 2,810 | 6,046 | 1,377 | 1,615 | 2,992 | 6,228 |
| Operating margin (EBIT) | 15.5% | 16.2% | 17.2% | 16.6% | 15.9% | 16.4% | 15.8% | 15.4% | 15.6% | 16.3% |
| Financial items | -137 | -152 | -190 | -201 | -289 | -680 | -162 | -156 | -317 | -709 |
| Income before tax | 1,158 | 1,363 | 1,440 | 1,405 | 2,521 | 5,366 | 1,215 | 1,460 | 2,675 | 5,520 |
| Profit margin (EBT) | 13.9% | 14.6% | 15.2% | 14.6% | 14.2% | 14.6% | 14.0% | 13.9% | 13.9% | 14.4% |
| Tax | -278 | -333 | -341 | -334 | -611 | -1,286 | -268 | -321 | -589 | -1,264 |
| Net income of disposal group classified as held for sale | - | - | - | - | - | - | -4 | 17 | 13 | 13 |
| Net income | 880 | 1,031 | 1,099 | 1,071 | 1,910 | 4,080 | 943 | 1,156 | 2,099 | 4,269 |
| Allocation of net income: | ||||||||||
| Shareholders in ASSA ABLOY AB | 876 | 1,019 | 1,090 | 1,064 | 1,895 | 4,050 | 941 | 1,143 | 2,084 | 4,238 |
| Non-controlling interest | 4 | 11 | 9 | 7 | 15 | 30 | 2 | 13 | 14 | 31 |
| OPERATING CASH FLOW | ||||||||||
| Q1 | Q2 | Q3 | Q4 Jan-Jun | Full Year | Q1 | Q2 | Jan-Jun | 12 month | ||
| 2010 | 2010 | 2010 | 2010 | 2010 | 2010 | 2011 | 2011 | 2011 | rolling | |
| Operating income (EBIT) | 1,295 | 1,515 | 1,630 | 1,606 | 2,810 | 6,046 | 1,377 | 1,615 | 2,992 | 6,228 |
| Depreciation | 241 | 265 | 245 | 244 | 506 | 995 | 253 | 248 | 501 | 990 |
| Net capital expenditure | -50 | -270 | -153 | -235 | -320 | -708 | -161 | -223 | -384 | -772 |
| Change in working capital | -475 | 79 | 167 | 591 | -396 | 362 | -963 | -181 | -1,145 | -386 |
| Paid and received interest | -77 | -170 | -29 | -179 | -247 | -455 | -74 | -152 | -226 | -434 |
| Adjustment for non-cash items | -64 | 21 | 30 | 58 | -43 | 45 | 16 | 4 | 20 | 108 |
| Operating cash flow 5 ) | 870 | 1,440 | 1,890 | 2,085 | 2,310 | 6,285 | 448 | 1,311 | 1,758 | 5,734 |
| Operating cash flow / Income before tax 5) | 0.75 | 1.06 | 1.31 | 1.48 | 0.92 | 1.17 | 0.37 | 0.90 | 0.66 | 1.04 |
| CHANGE IN NET DEBT | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Q1 | Q2 | Q3 | Q4 Jan-Jun | Full Year | Q1 | Q2 | Jan-Jun | |||
| 2010 | 2010 | 2010 | 2010 | 2010 | 2010 | 2011 | 2011 | 2011 | ||
| Net debt at beginning of the period | 11,048 | 11,469 | 12,608 | 10,864 | 11,048 | 11,048 | 10,564 | 21,586 | 10,564 | |
| Operating cash flow | -870 | -1,440 | -1,890 | -2,085 | -2,310 | -6,285 | -448 | -1,311 | -1,758 | |
| Restructuring payment | 112 | 182 | 71 | 101 | 294 | 465 | 48 | 67 | 114 | |
| Tax paid | 261 | 241 | 94 | 203 | 502 | 799 | 235 | 363 | 598 | |
| Acquisitions/Disposals | 768 | 373 | 720 | 1,458 | 1,141 | 3,319 | 11,606 | 996 | 12,603 | |
| Dividend | - | 1,317 | - | - | 1,317 | 1,317 | - | 1,472 | 1,472 | |
| Purchase of treasury shares | - | 48 | - | - | 48 | 48 | - | 17 | 17 | |
| Translation differences and other | 150 | 418 | -739 | 23 | 568 | -147 | -419 | 213 | -207 | |
| Net debt at end of period | 11,469 | 12,608 | 10,864 | 10,564 | 12,608 | 10,564 | 21,586 | 23,403 | 23,403 | |
| Net debt / Equity | 0.57 | 0.62 | 0.55 | 0.51 | 0.62 | 0.51 | 1.03 | 1.10 | 1.10 | |
| NET DEBT | ||||||||||
| Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | |||||
| 2010 | 2010 | 2010 | 2010 | 2011 | 2011 | |||||
| Non current interest-bearing receivables | -64 | -60 | -56 | -62 | -64 | -58 | ||||
| Current interest -bearing investments including derivatives | -699 | -205 | -252 | -170 | -378 | -315 | ||||
| Cash and bank balances | -1,216 | -1,271 | -1,225 | -1,280 | -1,298 | -1,299 | ||||
| Pension provisions | 1,114 | 1,150 | 1,056 | 1,078 | 1,179 | 1,214 | ||||
| Other non current interest -bearing liabilities | 10,561 | 10,265 | 9,481 | 8,134 | 7,479 | 6,582 | ||||
| Current interest -bearing liabilities including derivatives | 1,773 | 2,729 | 1,860 | 2,864 | 14,668 | 17,279 | ||||
| Total | 11,469 | 12,608 | 10,864 | 10,564 | 21,586 | 23,403 | ||||
| CAPITAL EMPLOYED AND FINANCING | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | ||||
| 2010 | 2010 | 2010 | 2010 | 2011 | 2011 | |||||
| Capital employed | 31,523 | 33,051 | 30,495 | 31,385 | 36,267 | 38,232 | ||||
| - of which, goodwill | 22,480 | 23,659 | 22,085 | 22,279 | 25,343 | 25,663 | ||||
| - of which, other intangibles and fixed assets | 7,797 | 8,160 | 7,450 | 8,336 | 8,496 | 10,129 | ||||
| - of which, shares in associates | ||||||||||
| 38 | 37 | 37 | 37 | 1,111 | 1,121 | |||||
| Assets and liabilities of disposal group classified as held for sale Net debt |
- 11,469 |
- 12,608 |
- 10,864 |
- 10,564 |
6,299 21,586 |
6,379 23,403 |
||||
| Non-controlling interest | 167 | 174 | 157 | 169 | 198 | 301 | ||||
| Shareholders' equity, excluding non-controlling interest | 19,887 | 20,269 | 19,474 | 20,652 | 20,783 | 20,907 | ||||
| DATA PER SHARE | Q1 | Q2 | Q3 | Q4 Jan-Jun | Full Year | Q1 | Q2 | Jan-Jun | 12 month | |
| 2010 SEK |
2010 SEK |
2010 SEK |
2010 SEK |
2010 SEK |
2010 SEK |
2011 SEK |
2011 SEK |
2011 SEK |
rolling SEK |
|
| Earnings per share after tax and before dilution 1) | 2.39 | 2.79 | 2.98 | 2.91 | 5.18 | 11.07 | 2.57 | 3.08 | 5.65 | 11.54 |
| Earnings per share after tax and dilution 2 ) | ||||||||||
| 2.36 | 2.74 | 2.93 | 2.86 | 5.10 | 10.89 | 2.53 | 3.07 | 5.60 | 11.39 | |
| Earnings per share after tax and dilution after dilution 2 ) | 56.94 | 57.89 | 55.65 | 58.65 | 57.88 | 58.64 | 58.34 | 59.35 | 58.51 |
| SEK M | EMEA 6 ) | Americas 7 ) | Asia Pacific 8 ) | Technologies 9 ) | Global | Entrance Systems |
Other | Total | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Apr -Jun and 30 Jun respectively | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 |
| Sales, external | 3,195 | 3,185 | 2,492 | 2,167 | 1,450 | 1,529 | 1,221 | 1,396 | 999 | 2,224 | 9,356 3) | 10,502 3 ) | ||
| Sales, intragroup | 116 | 67 | 11 | 10 | 115 | 101 | 19 | 19 | 13 | 11 | -276 | -208 | ||
| Sales | 3,311 | 3,253 | 2,503 | 2,177 | 1,566 | 1,630 | 1,240 | 1,416 | 1,012 | 2,235 | -276 | -208 | 9,356 | 10,502 |
| Organic growth 4 ) | 3% | -3% | -4% | 2% | 18% | 12% | 5% | 17% | -2% | 5% | 2% | 5% | ||
| Operating income (EBIT) | 525 | 510 | 493 | 456 | 222 | 232 | 208 | 224 | 145 | 281 | -78 | -88 | 1,515 | 1,615 |
| Operating margin (EBIT) | 15.9% | 15.7% | 19.7% | 20.9% | 14.2% | 14.3% | 16.8% | 15.9% | 14.3% | 12.6% | 16.2% | 15.4% | ||
| Capital employed | 9,695 | 9,696 | 9,271 | 7,814 | 4,792 | 4,325 | 5,699 | 5,832 | 4,212 | 11,198 | -618 | -633 | 33,051 | 38,232 |
| - of which goodwill | 5,423 | 5,707 | 6,535 | 5,631 | 4,160 | 3,076 | 4,205 | 4,188 | 3,335 | 7,060 | - | - | 23,659 | 25,663 |
| - of which other intangibles and fixed assets | 2,945 | 2,676 | 1,877 | 1,429 | 1,583 | 2,256 | 1,166 | 1,347 | 466 | 2,300 | 123 | 121 | 8,160 | 10,129 |
| - of which shares in associates | 37 | 33 | - | - | - | - | - | - | - | 1,088 | - | - | 37 | 1,121 |
| Return on capital employed | 19.9% | 20.6% | 21.6% | 23.6% | 20.3% | 22.4% | 14.5% | 15.0% | 13.6% | 10.6% | 18.1% | 16.8% | ||
| Operating income (EBIT) | 525 | 510 | 493 | 456 | 222 | 232 | 208 | 224 | 145 | 281 | -78 | -88 | 1,515 | 1,615 |
| Depreciation | 109 | 101 | 59 | 43 | 41 | 34 | 37 | 28 | 15 | 37 | 3 | 4 | 265 | 248 |
| Net capital expenditure | -159 | -77 | -24 | -29 | -60 | -67 | -22 | -16 | -5 | -34 | 0 | -1 | -270 | -223 |
| Movement in working capital | 139 | -105 | 58 | 11 | -147 | 0 | -19 | 33 | -49 | -117 | 97 | -3 | 79 | -181 |
| Cash flow 5) | 613 | 429 | 586 | 482 | 57 | 199 | 204 | 270 | 106 | 166 | 1,589 | 1,459 | ||
| Adjustment for non-cash items | 21 | 4 | 21 | 4 | ||||||||||
| Paid and received interest | -170 | -152 | -170 | -152 | ||||||||||
| Operating cash flow 5) | 1,440 | 1,311 |
| SEK M | EMEA 6 ) | Americas 7 ) | Asia Pacific 8 ) | Technologies 9 ) | Global | Entrance Systems |
Other | Total | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Jan -Jun and 30 Jun respectively | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 |
| Sales, external Sales, intragroup |
6,399 208 |
6,219 133 |
4,688 20 |
4,347 19 |
2,383 197 |
2,636 186 |
2,291 34 |
2,688 34 |
1,940 26 |
3,311 22 |
-485 | -394 | 17,701 3) | 19,201 3 ) |
| Sales | 6,607 | 6,352 | 4,708 | 4,366 | 2,580 | 2,822 | 2,325 | 2,722 | 1,966 | 3,333 | -485 | -394 17,701 | 19,201 | |
| Organic growth 4 ) | 2% | -2% | -7% | 5% | 15% | 11% | 0% | 18% | -3% | 4% | -1% | 5% | ||
| Operating income (EBIT) | 1,050 | 1,028 | 912 | 896 | 326 | 379 | 392 | 412 | 278 | 439 | -148 | -162 | 2,810 | 2,992 |
| Operating margin (EBIT) | 15.9% | 16.2% | 19.4% | 20.5% | 12.6% | 13.4% | 16.8% | 15.1% | 14.2% | 13.2% | 15.9% | 15.6% | ||
| Capital employed - o fwhich goodwill - of which other intangibles and fixed assets - of which shares in associates |
9,695 5,423 2,945 37 |
9,696 5,707 2,676 33 |
9,271 6,535 1,877 - |
7,814 5,631 1,429 - |
4,792 4,160 1,583 - |
4,325 3,076 2,256 - |
5,699 4,205 1,166 - |
5,832 4,188 1,347 - |
4,212 3,335 466 - |
11,198 7,060 2,300 1,088 |
-618 - 123 - |
-633 - 121 - |
33,051 23,659 8,160 37 |
38,232 25,663 10,129 1,121 |
| Return on capital employed | 19.8% | 20.7% | 20.5% | 23.0% | 17.2% | 18.6% | 13.7% | 13.8% | 13.0% | 11.2% | 17.0% | 16.5% | ||
| Operating income (EBIT) Depreciation Net capital expenditure Movement in working capital |
1,050 220 -199 -28 |
1,028 202 -140 -387 |
912 114 -47 -72 |
896 91 -60 -214 |
326 66 -85 -251 |
379 70 -106 -281 |
392 73 -48 -95 |
412 80 -39 -234 |
278 27 -28 -3 |
439 50 -46 -137 |
-148 6 87 53 |
-162 8 8 108 |
2,810 506 -320 -396 |
2,992 501 -384 -1,145 |
| Cash flow 5) | 1,043 | 704 | 906 | 713 | 56 | 61 | 323 | 218 | 275 | 306 | 2,600 | 1,964 | ||
| Adjustment for non-cash items Paid and received interest |
-43 -247 |
20 -226 |
-43 -247 |
20 -226 |
||||||||||
| Operating cash flow 5) | 2,310 | 1,758 | ||||||||||||
| Average number of employees | 9,566 | 9,672 | 6,757 | 6,929 | 15,361 15,445 | 2,379 | 2,886 | 2,799 | 4,621 | 100 | 124 | 36,962 | 39,677 |
| SEK M | 6 ) EMEA |
Americas 7 ) | Asia Pacific 8 ) | Global Technologies 9 ) |
Entrance Systems |
Other | Total | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Jan - Dec and 31 Dec respectively | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 |
| Sales, external Sales, intragroup |
327 | 13,275 12,660 376 |
9,831 49 |
9,491 45 |
3,507 282 |
5,698 384 |
4,664 102 |
4,951 64 |
3,685 47 |
4,024 48 |
-807 | -916 | 34,963 3 ) | 36,8233 ) |
| Sales | 13,601 13,036 | 9,880 | 9,536 | 3,789 | 6,081 | 4,766 5,015 | 3,733 | 4,072 | -807 | -916 34,963 | 36,823 | |||
| Organic growth 4 ) | -12% | 2% | -19% | -2% | -1% | 14% | -12% | 10% | -3% | -2% | -12% | 3% | ||
| Operating income (EBIT) | 2,056 | 2,174 | 1,925 | 1,886 | 459 | 843 | 766 | 862 | 587 | 627 | -380 | -346 | 5,413 | 6,046 |
| Operating margin (EBIT) | 15.1% | 16.7% | 19.5% | 19.8% | 12.1% | 13.9% | 16.1% | 17.2% | 15.7% | 15.4% | 15.5% | 16.4% | ||
| Items affecting comparability 10) | -789 | - | - | - | -2 | - | -167 | - | -81 | - | - | - | -1,039 | - |
| Operating income (EBIT) including | ||||||||||||||
| items affecting comparability | 1,267 | 2,174 | 1,925 | 1,886 | 457 | 843 | 599 | 862 | 506 | 627 | -380 | -346 | 4,374 | 6,046 |
| Capital employed | 9,814 | 8,759 | 8,687 | 8,163 | 2,768 | 4,080 | 5,464 | 5,772 | 4,116 | 4,365 | -467 | 245 | 30,382 | 31,385 |
| - of which, goodwill | 5,540 | 5,471 | 6,003 | 6,039 | 1,536 | 3,202 | 4,030 | 4,265 | 3,223 | 3,303 | - | - | 20,333 | 22,279 |
| - of which, other intangibles and fixed assets | 3,097 | 2,632 | 1,757 | 1,566 | 933 | 2,306 | 1,138 | 1,267 | 485 | 431 | 130 | 136 | 7,541 | 8,336 |
| - of which, shares in associates | 39 | 37 | - | - | - | - | - | - | - | - | - | - | 39 | 37 |
| Return on capital employed | ||||||||||||||
| excluding items affecting comparability | 16.9% | 21.6% | 20.5% | 21.3% | 16.1% | 25.1% | 12.9% | 14.7% | 15.2% | 14.6% | 16.2% | 18.5% | ||
| Operating income (EBIT) | 1,267 | 2,174 | 1,925 | 1,886 | 457 | 843 | 599 | 862 | 506 | 627 | -380 | -346 | 4,374 | 6,046 |
| Restructuring costs | 789 | - | - | - | 2 | - | 167 | - | 81 | - | - | - | 1,039 | - |
| Depreciation | 473 | 417 | 236 | 222 | 99 | 142 | 156 | 145 | 38 | 57 | 11 | 14 | 1,014 | 995 |
| Net capital expenditure | -281 | -317 | -134 | -114 | -80 | -198 | -127 | -109 | -33 | -47 | -9 | 76 | -664 | -708 |
| Movement in working capital | 602 | 334 | 649 | 19 | 132 | 130 | 211 | -30 | 88 | -58 | -222 | -33 | 1,460 | 362 |
| Cash flow 5) | 2,850 | 2,607 | 2,677 | 2,013 | 610 | 917 | 1,005 | 868 | 680 | 580 | 7,222 | 6,695 | ||
| Adjustment for non-cash items Paid and received interest |
127 -507 |
45 -455 |
127 -507 |
45 -455 |
||||||||||
| Operating cash flow 5) | 6,843 | 6,285 | ||||||||||||
| Average number of employees | 10,138 | 9,471 | 6,897 | 6,969 | 7,560 15,510 | 2,416 | 2,487 | 2,253 | 2,738 | 112 | 104 | 29,375 | 37,279 |
Jan-Dec Jan-Jun Jan-Jun Apr -Jun Apr -Jun
Number of shares, thousands. 2010 2010 2011 2010 2011 1 ) Calculation used for earnings per share after tax and before dilution 365,744 365,850 368,878 365,783 368,114
| 9 ) Sales by Continent. | Jan-Dec 2010 |
Jan-Jun 2010 |
Jan-Jun 2011 |
|---|---|---|---|
| Europe | 15,789 | 7,857 | 9,171 |
| North America | 11,907 | 5,790 | 5,609 |
| Central and South America | 854 | 397 | 410 |
| Africa | 622 | 320 | 279 |
| Asia | 5,533 | 2,335 | 2,743 |
| Pacific | 2,118 | 1,002 | 989 |
4 ) Organic growth concern comparable units after adjustment for acqusitions and currency effects.
2 ) Calculation used for earnings per share after tax and dilution 372,810 372,882 373,000 372,815 367,677
5 ) Excluding restructuring items.
6 ) Europe, Middle East and Africa. 7 ) North, Central and South America.
8 ) Asia, Australia and New Zealand.
9 ) ASSA ABLOY Hospitality and HID Global. 10) Items affecting comparability consist of restructuring costs.
11) Conversion of convertible debenture relating to Incentive 2006.
At 30 June 2011 ASSA ABLOY owns 26,709,682 shares representing 98.9% of Cardo. The total purchase price was SEK 11,217 M for 98.9% of the shares. Remaining shares will be acquired during the second half of 2011.
The company was consolidated in ASSA ABLOY with effect from 18 March 2011. Valuation of intangible assets for separate recognition from goodwill took place during 2011. The remaining goodwill value will be attributable mainly to synergies and other intangible assets not qualified for separate recognition.
Preliminary acquisition analysis for Cardo Entrance Solutions – i.e. excluding disposal groups held for sale – indicates that goodwill amounts to SEK 3,070 M. Remuneration of employees after termination of employment and inventories have been adjusted to fair value with tax effects due considered .
The table below shows a preliminary acquisition analysis for Cardo at 18 March 2011, excluding disposal groups held for sale in accordance with IFRS 5, 'Non-current Assets Held for Sale and Discontinued Operations'. The figures are preliminary and subject to change.
| Preliminary acquisition analysis for Cardo Entrance Solutions |
SEK M |
|---|---|
| Purchase price paid for Cardo Group | 11,217 |
| Less: Disposal groups held for sale | -6,280 |
| Total purchase price | 4,937 |
| Identifiable acquired assets and liabilities | |
| Intangible assets | 1,444 |
| Tangible fixed assets | 352 |
| Financial fixed assets | 203 |
| Inventories | 517 |
| Accounts receivable | 921 |
| Cash and cash equivalents | 176 |
| Interest-bearing liabilities | -111 |
| Other liabilities | -1,513 |
| Acquired net assets at fair value | 1,989 |
| Non-controlling interest | -122 |
| Goodwill | 3 070 |
| Net sales from times of acquisition | 1,275 |
| EBIT from times of acquisition | 121 |
| Net income from times of acquisition | 83 |
Acquisition-related expenses for Cardo amount to SEK 33 M and have been reported as 'Other operating expenses' in 2010.
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